Optimism for retail sales despite SARS

A'an Suryana, The Jakarta Post, Jakarta

Sales in the country's retail industry this year would not be significantly affected by the outbreak of Severe Acute Respiratory Syndrome (SARS), industry experts said Monday.

Richard Santosa of the Indonesian Retailers Association (Aprindo) told The Jakarta Post that sales had been largely been generated by middle- and low-income households.

He said that consumer confidence in this category remained high despite the outbreak of the deadly disease.

"It seems the disease does not affect the middle- to lower- (income) class people. But it does hit confidence among the middle- to upper-class consumers," Richard said.

"The lifestyle's of poorer people also prevents them from potentially being affected by the disease, such as they are less exposed to the air conditioners in closed spaces and have less contact with people who often go abroad," Indonesian Food and Beverage Association chairman Thomas Dharmawan said.

With the high level of consumer confidence in the low-income bracket, retailers are optimistic the industry will grow by around 3 percent this year.

Several analysts have previously said the outbreak would badly hit various sectors in the economy, including airlines, tourism, hotels and retail as consumer confidence plunged. Many people would avoid going to malls or shopping centers to avoid contact with people affected by SARS, analysts said.

But Kustardjono Prodjolalito, an industry observer, said the malls and shopping centers, particularly those catering to middle- and lower- income households, still remained crowded.

He said sales would surge should the SARS epidemic turn ugly.

"People will increase retail stocks for more than one month, if the situation worsens.

After this big purchase, they will tend to stay at home, waiting until the situation improves," Kustardjono said.